.
Russia's invasion into Ukraine
significantly changes world’s
political and economic
situation
Economic recovery in the Baltics in
2021 has been faster than
anticipated and less than two years
after beginning start of the Covid-19
pandemic, GDP in the Baltic
countries has already exceeded pre-
pandemic levels. Growth in the
global economy also remains strong,
but inflation in the Baltics has risen
sharply in 2021 and is the highest in
the EU. Rising prices will impact
consumption, but situation in labour
market is good, wages continue to
increase, and unemployment is
declining. Inflation is notable
challenge in the global economy,
Covid-19 pandemic is not yet over,
and high energy costs are risk to
economic growth in the Baltic region.
Russia's invasion into Ukraine has
significantly changed the political and
economic situation in the world, and
it will certainly affect the economies
of the Baltic States. Sanctions and
trade restrictions against Russia, as
well as Belarus, will affect Baltic
exporters, while higher energy prices
will reduce the purchasing power of
the households. Consumer and
investor sentiment could also
become more cautious, while rising
prices for metals, food and other
natural resources is also a risk to the
global economy. However, exact
impact of the Russian invasion of
Ukraine on the Baltic economies is
currently difficult to assess, as the
situation is changing and will depend
on the further development of the
conflict.
Innovations and development
On the back of the digital strategy of
Citadele, the Covid-19 situation
pushed us to accelerate digital
solutions to secure our clients access
to remote financial services. We
managed to launch digital on-
boarding for SMEs in Latvia, Citadele
Business Portal, convenient and
easy to use e-commers solutions,
incl. Klix Pay later, Citadele Phone
POS, Citadele Robo-Assistant,
broad Mobile App functionality and
wide range of contactless payments,
incl. Google Pay, Fitbit Pay and
Garmin Pay. All these solutions were
welcomed by our customers and
helped them to get more proficient
financial services remotely and to
adjust their businesses to the new
environment.
Bank with one of the best
customer service in the
Baltics
Our commitment of providing the
best customer service enabled
Citadele to maintain the top position
among banks in the Baltics,
according to the annual mystery
shopper survey conducted by
international customer service
evaluation company DIVE. Citadele
was announced as the bank with the
best customer service in Latvia for
the seventh time and having the third
best result in Lithuania and Estonia.
Growing client base
We are proud for steadily growing
number of active customers –
reaching 361 thousand clients as of
31 December 2021, 11% growth year
over year. The number of active
Mobile App users reached 207
thousand, a 41% increase y-o-y.
EUR 1.1 billion issued in new
financing to Baltic private,
SME, corporate and leasing
customers
We have continued to support the
business community with financing
for growth and expansion.
New financing to our customers
reached a record high of EUR 1.1
billion in 12 months 2021, 2.3 times
higher than in 2020. EUR 293 million
were issued in Q4 2021, 9% growth
q-o-q.
As part of our business focus, we
have been supporting a number of
larger deals such as EUR 21 million
to Domina Shopping and EUR 11
million to VMG Group, and serving
local transactions, for example in
Latvia – Ape Motors, Eften Domina,
Daugavpils Autobusu parks,
Samariešu biedrība, Pharmidea,
Agrocredit, Mārupes siltumnīcas and
in Lithuania – Viciunai Group, VPH,
Elmoris, Modus Asset Management,
and Estonia – Lumi Retail Property..
Sharing the view that climate change
is becoming a key priority for a wide
range of industries, including
financial institutions, the Bank has
started a solar panels consumer
lending pilot in Lithuania in 2021,
helping the society to access
sustainable assets for a more
attractive price. Citadele will continue
to develop new offers supporting the
green transition and is committed to
issue significant support to green
projects during coming years.
The total loan book as of 31
December 2021 was EUR 2,702
million, 75% higher vs. year-end
2020. Portfolio growth was impacted
by acquisition of the SIA UniCredit
Leasing (rebranded to SIA Citadele
Leasing) at the beginning of 2021.
Overall, the financial standing of our
clients is reassuring, and portfolio
quality continued to improve and the
NPL ratio stood at 3.3% as of 31
December 2021, vs. 3.5% at the end
of 2020.
Strong financial results
Strong financial performance with net
profit reaching EUR 55.0 million in
2021, which translated into 14.8%